Five men, who between them ran three landbanking companies that raked in over 7m from around 80 investors using intimidatory and high pressure sales techniques, have been disqualified for a total of 53 years following an investigation by the Insolvency Service.

The five, Scott Assemakis, David Evans, Gavin Walter Gravesande, James William Murphy Dominic and James Whatley were directors of Ultraclass Limited, which traded as The Property Partnership, Burnhill Land Investments Limited and RTW (Burnhill) Limited, which sold plots of land that included areas of flood plain and part of the green belt.

Many of the plots were sold to investors for more than ten times their original purchase price, despite being sold within a few months of purchase with total sales estimated at around 6,778,316. Salesmen implied there would be high returns and used sales techniques, which sometimes left investors in tears.

The investigation also uncovered deficiencies in the books and records of all three companies.
All five directors gave undertakings to the Secretary of State for Business, Innovations and Skills not to act as directors or in any way manage or control companies from 7 July 2013 as follows:
– Scott Assemakis and David Evans directors of all three companies were disqualified for 11 years until 7 July 2024 and 9 July 2024 respectively
– Gavin Walter Gravesande director of Ultraclass Limited, trading as The Property Partnership was disqualified for 11 years until 7 July 2024
– James William Murphy director of Burnhill Land Investments Limited was disqualified for 10 years until 8 July 2023
– Dominic James Whatley director of RTW (Burnhill) Limited was disqualified for 10 years until 8 July 2023.

The investigation found all three companies conducted land banking operations involving the purchase of several different land sites and subsequent division of them into hundreds of smaller plots for onward sale to members of the public and other companies.

The sites themselves were either on green belt land, a conservation site, a site at high risk of flooding, a landscape protection area and land adjacent to an area of outstanding natural beauty. Given the nature of these plots, there was little prospect of them ever gaining planning permission.
In spite of this, the companies repeatedly provided customers with misleading information designed to give false expectations and more than 80 investors complained about intimidating behaviour. Customers who asked if they could sell their portfolio or get their money back, for example, were told they had to invest further in order to release their funds.

One customer told Insolvency Service: I have cancelled my daughters wedding due to not receiving my money as promised. Another was repeatedly told to invest further or risk losing everything. She said: They needed another 10,000, I said I didnt have any more money and was advised to borrow from friends and familyThe salesman called me saying they needed another 20,000,bringing the total to 30,000; I just burst into tears.

In the case of Ultraclass Limited, trading as The Property Partnership, the deficiency in the accounting records for the period from 1 March 2010 to 4 April 2011 meant that it was not possible to determine why various sums were paid to the directors including 1,304,550 to Mr Assemakis, 455,877 to Mr Evans and 1,538,500 to a third party company. Other payments included 452,373 to a connected party and 387,480 to connected companies.

It was also not possible to establish the source of 8,667,887 which was credited to the account, whether there were additional investors who constituted creditors in the liquidation or whether there were additional plots of land which constituted assets in the liquidation.

In the case of Burnhill Land Investments Limited, the deficiency in the accounting records for the period from 1 July 2009 to 10 August 2011 meant that it was not possible to determine:
– The reason for a number of credits and debits from the companys bank account
– Why sites, which were purchased for resale, were not recorded as assets in the companys signed accounts
– The whereabouts of 144,000 due to the company in respect of the sale of plots of land
– Why the company instructed a solicitor to send Transfer of Land documents to customers for land it did not own.

In the case of RTW (Burnhill) Limited, the deficiency in the accounting records for the entire period of trading meant that it was not possible to determine:
– The reason for a number of credits and debits from the companys bank account
– Why the companys financial statements for the period ended 30 June 2011 showed land purchases of 724,999
– Why a site, which was purchased for resale, was not recorded as an asset in the companys signed accounts
– The whereabouts of 2,207,000 due to the company for the sale of plots of land

Commenting on the disqualifications, Mark Bruce, a Chief Examiner at the Insolvency Service, said:
Company directors enjoy the privilege of limited personal liability but if they run a business in a way that is detrimental to its customers, then they lose that protection. The Insolvency Service will investigate such individuals and seek to remove them from the business environment.
Furthermore, directors are required to maintain sufficient accounting records that show and explain company transactions. However, the directors in this case failed to do this and the volume of unexplained transactions over its trading lifetime was highly suspicious. Directors tempted to keep poor accounting records should be warned that the Insolvency Service will take tough action against anyone who fails to meet these obligations.
The scale of losses for the unfortunate victims over these three companies is quite disgraceful. Those who tried to reduce their losses by pulling out of the scheme were met with underhand tactics. The Insolvency Service is determined to come down hard on directors who set out to rip people off by deliberately misrepresenting the investment opportunity on offer.

Source: http://insolvency.presscentre.com/